Tim’s take:
A 98% cut on the first £30,000 of your reference figure, and everything above that clawed back entirely. That is what delinked payments 2026 actually mean on the bank statement, and it is the moment many English farmers finally stop talking about BPS as if it still exists. Treat this as legacy income, not a planning pillar.
The mechanics matter. The Agriculture (Delinked Payments) (Reductions) (England) Regulations 2026, in force since 29 June, set those percentages, and the Rural Payments Agency runs the calc from your historical entitlement rather than anything you grow or stock now. So the practical question is when that smaller-than-ever cheque lands, because cashflow through early spring is already tight enough without assuming Defra money is on its way.
Watch the RPA payment window date when it drops, and model your 2027 budget on zero delinked income. Read this one twice if you have a reference figure above £30,000, because the tapering turns that ceiling into pure ceiling.
Delinked payments 2026 are capped at £600 for every English farm. Here is how the 98% reduction works, when the RPA pays, and what 2027 leaves behind.
A way through this story
What the 2026 reduction actually does
Delinked payments replaced the Basic Payment Scheme in England in 2024. You do not apply and you do not have to be farming the land: the Rural Payments Agency (RPA) calculates the figure from what your business drew historically, then cuts it by a percentage that Defra raises every year.
The figures are set by the Agriculture (Delinked Payments) (Reductions) (England) Regulations 2026, made on 8 June 2026 and in force since 29 June. For 2026 the reductions are 98% on the first £30,000 of your reference amount, and 100% on anything above £30,000.
That second line is the one people miss. Everything over £30,000 is gone entirely, so the £600 ceiling applies whether your reference amount is £31,000 or £310,000. A 3,000-acre arable business and a 200-acre one with a £30,000 reference amount receive the same £600.
Below the threshold the 98% still bites in proportion. There is no minimum-payment floor doing you any favours.
What you actually get, by reference amount
Because the first band is a flat 98%, the arithmetic is easy to do on the back of an envelope: take your reference amount up to £30,000 and divide by fifty.
- £5,000 reference amount: £100
- £10,000: £200
- £20,000: £400
- £30,000: £600
- £50,000: £600
- £150,000: £600
Those are our figures worked from the reduction table, not published examples, but the calculation is the one in the regulations. Anything at or above a £30,000 reference amount lands on the same £600, which is why farm size stopped predicting the payment this year.
How we got from BPS to £600
It is worth seeing the trajectory in one place, because each year’s announcement landed on its own and the cumulative effect is easy to underestimate.
Progressive reductions to the Basic Payment Scheme in England started in 2021 and were always intended to run to 2027. Delinking arrived in 2024, which severed the payment from the land and turned it into a historic entitlement being wound down. In 2024 the reductions ran from 50% on the lowest band up to 70% on the highest.
In 2025 the shape changed: a 76% reduction on the first £30,000 and nothing at all above it, which put the maximum payment at £7,200. For 2026 and 2027 that becomes 98% and 100%, and the maximum falls to £600.
So a business at or above the £30,000 threshold has gone from £7,200 to £600 in a single year, a 92% cut on top of everything that came before it. That is the number to hold in your head when you read that direct payments are “being phased out”. The phasing is effectively finished.
How your reference amount was set
Your reference amount is the average of the BPS payments made to your business for the 2020, 2021 and 2022 scheme years. It was fixed then and it does not move. Nothing you have done since, whether that is taking on ground, giving ground up or changing enterprise, changes it.
That cuts both ways, and the guidance is explicit: your reference amount is not affected if you transferred out some or all of your land after 16 May 2022. The money follows the business that claimed, not the acres. If you have taken on ground from a neighbour who has retired, their delinked payment did not come with it.
To be in the scheme at all you had to have claimed, and been eligible for, BPS in England in the 2023 scheme year. The one route in afterwards is inheritance: if you inherited eligible land after 15 May 2023 you can ask for the reference amount to be transferred, and those requests have to be in before 31 December 2027.
When the RPA pays delinked payments in 2026
Delinked payments are made as a single payment from 1 August each year. Not two instalments; that was the BPS pattern and it is gone.
Remittance advice is posted out, and businesses with a valid email address registered get an email linking to the statement instead. You can change the bank account the payment goes to at any time through the Rural Payments service.
At £600 the practical advice changes. The sum is too small to plan cashflow around, but it is still worth opening the statement and checking the arithmetic above, because a wrong reference amount is worth arguing about while there is still a 2027 payment attached to it.
If you think the figure is wrong
Reference amounts can still be amended. The guidance confirms that yours will change if your BPS reference data is amended after further RPA checks, such as following a BPS payment query or appeal. So an old, unresolved BPS dispute is not necessarily dead: it can still move this year’s and next year’s figure.
Queries go to the RPA at ruralpayments@defra.gov.uk with “Delinked payments” in the subject line, or by post to Rural Payments Agency, PO Box 352, Worksop, S80 9FG. If you get nowhere, the RPA’s published complaints procedure is the next step.
Be realistic about the stakes before you spend a week on it. On a £600 payment, a 10% error is £60. On a reference amount that also feeds 2027, it is £120 and an hour of your time is probably still worth it.
Business changes, death and executors
Delinked payments continue to the Single Business Identifier that claimed BPS in 2023, even where the business structure changed afterwards. Partnership changes and reorganisations do not create a new claim, and they do not create a second one.
Where a sole trader has died, the RPA treats it as business continuity rather than the end of the entitlement. Executors need to provide probate or letters of administration, and payments continue until the estate is settled. It is a small sum to be chasing during probate, but it is real money and it is straightforward to keep.
What it looks like on a real farm
AHDB modelled two typical businesses. A 455-hectare arable farm drops from £7,200 in 2025 to £600 in 2026, and £600 again in 2027. A 105-hectare dairy farm drops from £5,592 to £466, and £466 again in 2027.
The arable farm loses £6,600 of income for doing nothing differently. On a 455-hectare unit that is roughly £14.50 per hectare off the bottom line. Not fatal on its own, but it arrives in the same year as everything else.
The dairy example is the more useful one, because it shows what happens under the £30,000 threshold: no cap protects you, the 98% simply applies to whatever your reference amount was.
Where the money went
This is not a cut that vanished. Direct payment spending in England falls from roughly £324 million in 2025 to about £20 million in 2026/27, while the environmental land management budget rises to around £2 billion by the end of this Parliament.
The money moved from a payment based on what you once claimed to payments based on what you now do. Whether that is a good deal for your farm depends entirely on whether you are in a scheme, which is the whole point of the design.
If you are not, the SFI 2026 payment rates are the first place to look, and what is left of the Capital Grants pot is the second. We have written separately about where farm payments reform is heading.
The uncomfortable part is that scheme income is not a like-for-like swap. The old payment arrived for existing, on ground you were farming anyway. The new money is paid for doing something specific, usually for three years, sometimes on land that then produces less. That is a different decision, and it deserves a gross margin rather than a shrug.
The tax position
Delinked payments are taxed as income, exactly as BPS was. At £600 that is unlikely to change anyone’s tax planning on its own.
It matters more in the other direction. A business that has been running with several thousand pounds of untaxed-at-source income in the accounts each summer is now losing most of it, and if you have been paying tax on account against a profit figure that included it, the 2026 and 2027 numbers will look different from the ones your payments on account were based on.
2027, and then nothing
2027 is the final year of delinked payments, and the rate is already law rather than an intention: the same statutory instrument sets 98% and 100% for both the 2026 and the 2027 scheme years, so there is no further announcement to wait for.
After that there is no successor payment: no basic payment, no delinked payment, nothing that arrives because of who you are rather than what you have agreed to do.
For a lot of businesses the number worth working out is not this year’s £600. It is what the budget looks like in 2028 with the direct payment line deleted entirely, and whether the scheme income replacing it is signed rather than intended. If you are relying on an SFI agreement to fill that hole, check the end date of the agreement against 2028, because a three-year agreement signed this year runs out at roughly the moment the last direct payment does.
If you farm outside England
Delinked payments are an England-only mechanism, and the four nations have diverged sharply.
Scotland has gone the other way entirely. Its Rural Support Plan for 2026 to 2031 keeps direct payments as roughly 70% of funding, starts from the existing Basic Payment Scheme rather than dismantling it, and commits to no cliff edges in support to 2030 and beyond. A Scottish farm and an English one of the same size now have completely different support outlooks.
Wales is running its own transition through the Sustainable Farming Scheme and the BPS taper, and Northern Ireland keeps a different structure again under DAERA’s farm schemes.
Do not apply English figures to a Welsh, Scottish or Northern Irish budget, and be careful with any national commentary about “the end of direct payments”, because it is describing England.
Frequently Asked Questions
How much is the delinked payment in 2026?
A maximum of £600. A 98% reduction applies to the first £30,000 of your reference amount and a 100% reduction to anything above £30,000, so no English farm receives more than £600 however large the reference amount.
When will delinked payments be paid in 2026?
As a single payment from 1 August. Delinked payments are no longer split into two instalments as BPS was.
How is my delinked payment reference amount calculated?
It is the average of the BPS payments made to your business for the 2020, 2021 and 2022 scheme years. It was fixed at that point and does not change if your land area changes.
Do delinked payments continue after 2027?
No. The Agriculture (Delinked Payments) (Reductions) (England) Regulations 2026 set the 98% and 100% reductions for both the 2026 and 2027 scheme years, and 2027 is the final year. There is no successor direct payment in England.
Do I have to apply for delinked payments?
No. There is no application. You had to have claimed, and been eligible for, BPS in England in the 2023 scheme year, and the only later route in is inheriting eligible land after 15 May 2023, with transfer requests due before 31 December 2027.
Does my delinked payment transfer with land I sell or let out?
No. The reference amount is not affected if you transferred out some or all of your land after 16 May 2022. The payment follows the business that claimed BPS in 2023, not the acres, so land taken on from a retiring neighbour does not bring their delinked payment with it.
Do farmers in Scotland get delinked payments?
No. Delinked payments are England-only. Scotland’s Rural Support Plan for 2026 to 2031 keeps direct payments as around 70% of funding and commits to no cliff edges to 2030 and beyond. Wales and Northern Ireland run different arrangements again.
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Source: Defra and the RPA: Delinked payments, replacing the Basic Payment Scheme
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